(1) As used in this section, "single-family limit" means the number of individuals allowed to occupy each residential unit that is recognized by a land use authority in a zone permitting occupancy by a single family.
(2) A municipality may not adopt a single-family limit that is less than:
(a) three, if the municipality has within its boundary:
(i) a state university; or
(ii) a private university with a student population of at least 20,000; or
(b) four, for each other municipality.